alt Hacker NewsPresumably at least in part because China's just as dependent on TSMC as everyone else (at least for the time being). So it's a form of Mutally Assured Destruction, kind of like nuclear weapons. If they actually have to be used, then everyone's in for a bad time, but seeing as nobody wants that, it acts as a disincentive.
This makes no sense. China doesn't want Taiwan because of TSMC, it wanted Taiwan long before TSMC was a major player. The only effect of destroying factories would be to make Taiwan poorer, while China would still get what it wanted.